Recent studies seem to undermine long-held beliefs about health costs while reinforcing economic models of human behavior.
A December 2017 study in the journal HealthAffairs found that expanding health insurance does not lead to a reduction in the use of hospital emergency rooms and emergency departments. This runs counter to the common opinion that emergency room use – and the high cost of care in emergency rooms – will decrease with broader insurance coverage.
“Two facts may help explain this unexpected finding,” reported HealthAffairs. “First, there is a common misperception that the uninsured use the ED (emergency department) more than the insured. In fact, insured and uninsured adults use the ED at very similar rates and in very similar circumstances—and the uninsured use the ED substantially less than the Medicaid population. Second, while the uninsured do not use the ED more than the insured, they do use other types of care much less than the insured.”
Commenting on the findings, Katherine Baicker, dean of the University of Chicago’s Harris School of Public Policy, told the Washington Post, “It would be nice if giving people insurance did get them so healthy and so much access to other care that they didn’t need to go to the emergency department, but that does not seem to be the case. It seems clear to me that expanding insurance, in and of itself, does not contain spending. It increases spending, by giving people who had very limited access to care the ability to get their health-care needs met.”
Baicker is a co-author of an earlier study that corroborates the HealthAffairs investigation. Her 2014 rigorous research, published in the journal Science in 2014, showed that those who gained coverage under the expansion of Medicaid made 40 percent more visits to emergency rooms than those who were uninsured.
The study found “increases in emergency-department visits across a broad range of types of visits, conditions, and subgroups, including increases in visits for conditions that may be most readily treatable in primary care settings.”
The efficiency of treating people in primary care settings is reinforced by the latest Minnesota Health Scores. The non-profit and independent Minnesota Community Measurement found that medical groups in the state vary dramatically in their costs – up to 90 percent – with one of the most significant variations coming in the frequency with which patients access hospital emergency departments.
Providing people with health coverage may not be enough on its own to reduce costs. Primary care clinics need to take the additional step of educating patients – especially those with chronic conditions – on which situations warrant a hospital visit and which visits can be avoided.
Otherwise, it seems that basic behavioral economics take hold: The more affordable a service is, the more it will be used.